By Alistair Grant

SCOTLAND should build 35,000 social houses for rent between 2021 and 2026 at an estimated cost to the public purse of £500 million a year, a major new report has argued.

Stephen Boyle, former chief economist at the Royal Bank of Scotland, said the move would add billions to the country’s GDP.

His report, commissioned by housing and homelessness charity Shelter Scotland, said it would create jobs and boost incomes as well as enhancing health and educational attainment as Scotland emerges from the coronavirus crisis. 

A New Economic Case for Social Housing is based on economic modelling from the Scottish Policy Foundation and the Fraser of Allander Institute at the University of Strathclyde. 

It said providing houses to people who would have been homeless boosts the supply of labour, which it estimated would add £4bn to GDP.

When children live in decent houses, it argued, their educational attainment and health improve, making them more productive in later life. This would boost GDP by £1.5bn.

Building the houses and maintaining them would add up to £6.4bn to GDP and generate an average of 900 jobs per year, it said.

While the report calls for the building of more than 35,000 new social homes, based on updated projections and continued growth in demand for social housing, Shelter Scotland said this figure should now be closer to 37,100.

Mr Boyle said: “While social housing is not the silver bullet that alone will lead Scotland to improved wellbeing and prosperity, the good it promotes and the harms it prevents will go a long way to getting us all there.”

Social housing in Scotland is housing owned and managed by public authorities, most often by councils and housing associations.

Research by Shelter Scotland, the Chartered Institute of Housing and the Scottish Federation of Housing Associations found that in order to meet the current housing shortfall, Scotland needs to build at least 37,100 social homes between 2021 and 2026.

Campaigners called for an overall investment of £3.4bn to build 53,000 affordable new homes over the period – 37,100 of which should be for social rent.

During the current parliamentary term, which will end in May, the Scottish Government committed to building 50,000 affordable homes, including 35,000 properties for social rent. 

Alison Watson, director of Shelter Scotland, said: “While we commend them for building more social homes than ever before, they are in effect running the bath without the plug.”

Housing minister Kevin Stewart said the Scottish Government has delivered more than 95,000 affordable homes since 2007. He said: “The Affordable Housing Supply Budget for this financial year was increased by £17m to £843m, and we have also provided a commitment of £300m interim funding certainty for 2021/22. This will ensure that affordable homes continue to be delivered beyond this current parliamentary term ahead of the spending review later this year.

“The impact of lockdown meant that there was a necessary pause in the delivery of affordable and social homes at a critical time in our 50,000 target period. We are continuing to work with partners across the housing sector in order that the programme can be progressed, as construction resumes in a new safe way.”